Businesses are built on a reputation. It takes years to build a reputation, yet it is surprising that very few companies really implement reputation management. Large companies are able to ride the power of their brand which helps in maintaining reputation. It is small companies which suffer the set-back if it is impacted negatively due to some event. Brand is priceless for the company and so is the reputation, companies spend huge amount of money on promoting the brand and very few when it comes to protecting the reputation. Most of the companies implement reputation management only when there is some sort of crisis.
Why is reputation management important? It is no secret that today the world has become narrow thanks to the internet. Many bloggers have demonstrated that they can influence the minds the customers. Blogs have given voice to the customer which was unheard of in static webpage era. Blogs have made internet more dynamic. The rise of social media is another factor worth consideration. Social media has transformed the way conversations were carried by the people. Social media and blogs have become mechanism sharing the innermost thoughts of the customer. Companies cannot afford to watch passively because a dissatisfied customer might not write about his complaints; instead he can choose to voice his opinion on sites like Facebook, Twitter etc. which can influence the mind of potential of a probable customer.
The following example highlights the need for reputation management:
Kryponite is the manufacturer of high-end locks for bicycles. They have always prided in their quality. It was true that the company was obsessed with quality. No wonder the locks of the company were expensive. Everything was fine until one day it was revealed in a online forum that Kryponite locks could be opened with the help of small ballpoint pen. This one discussion was powerful enough to plummet the sales of the company. The company was forced to recall nearly half a million locks and replace them. It was devastating for a company to replace almost 2 months of production.
The above case highlights the importance of such management. Businesses have become more vulnerable due to internet. This kind of management is not just about damage control, it is an active participation by the company in conversation. It builds an invincible bond between the customer and the company. Active conversation is a beautiful way to avoid crisis like Kryponite. Reputation management helps to respond to negative or positive feedback in an orderly manner; it helps the company recognize threats and opportunities and prepares the company to take maximum advantage from situations which are beyond the control of a company.
There have been cases where the most reputed companies have failed to survive the conditions which were caused due to human error. Enron is a classic example of how reputable companies can fall like a pack of cards. A company must ensure that adequate management systems are in place to control unforeseen events which could threaten the existence of the company.
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